Top performing enterprises have 2 to 3 times fewer strategic suppliers than their lower-performing peers or competitors. The deliveries for many high end businesses require strategic sourcing, not tactical sourcing. The important thing in strategic sourcing is the quality of your partnerships, not the quantity of your suppliers.

Use strategic supplier management to do better optimization

The most obvious benefit enterprises will experience from strategic supplier management would be higher levels of cost savings. By identifying and selecting suppliers that will provide the highest value at the right pricing will enable an enterprise to continuously achieve higher cost savings.

Aligning your sourcing activities to your business goals is at the crux of strategic supplier management. Better alignment allows your business to achieve higher business performance with higher efficiency and minimal supply chain risks.

Use strategic partnership to grow your business

Enterprises need to realize that supplier strategies go both ways. Most companies focus on what suppliers can do for them rather than on what they can do with the supplier to lower costs. Enterprises can start gaining the strategic sourcing advantages by treating their suppliers as true partners for long term wins. Strategic partnership can help you grow your business in the following ways:

Access to new customers

A strategic partnership means access to new customers, and embedded in this is an opportunity for free advertisement.

Opportunity to reach new markets

Along with an extended reach into a wider variety of customers, your brand is now able to expand its horizons in areas previously unexplored.

Added value for previous customers

By establishing roots with other corporations (strategic partners), you increase the chance that you’re getting the words of month benefits.

Brand awareness

By pairing your service with successful partners that have large customer base.

Brand trust

Brand trust spawns naturally from a good business partnership. When people see you work well with your partners, they will be more willing to support your business. It is all part of creating a healthy, stable and productive network.

Use business alliance to increase your competitive advantages

When the trust level between you and your strategic partners has continuously increased, you have the opportunities to turn your partnerships into business alliances to accelerate your speed-to-market. In addition to creating strategic optionality and accelerating the time to value capture, strategic business alliances can provide the added advantage of reducing capital requirements and thereby reduce risks.